Brussels 27 October 2011 – The Commission has today decided to refer Cyprus to the EU's Court of Justice because its car taxation rules discriminate against non-Cypriot EU citizens who transfer a car into Cyprus.

Under Cypriot legislation, EU nationals who set up a permanent residence in Cyprus are only exempted from paying excise duty on a new imported car if they do not practice a profession in Cyprus. Such a condition does not apply to Cypriot citizens, nationals and descendants who return to live permanently in Cyprus.

This regime discriminates against non-Cypriot EU citizens and is contrary to EU rules which guarantee the free movement of workers and freedom of establishment (Articles 18, 45 and 49 of the Treaty on the Functioning of the European Union).

The Commission requested Cyprus to amend its legislation within a two-months in January 2011 (IP/11/77). However, Cyprus has still not taken the necessary measures to amend its rules.

For press releases issued on infringement proceedings in the area of taxation or customs see: